Japan has become "the quintessential smart power" and the new "leader of the liberal order in Asia," according to a new index of power in the region published Wednesday by a leading Australian think tank.

The release of the Lowy Institute's Asia Power Index 2019 comes as China and the United States battle for global and regional dominance, but reveals that beyond the competition between the two titans, Japan, ranked No. 3 in the survey, lies within a "distinct tier" of leading powers that are themselves greatly influencing the region.

"There is often a temptation to reduce the complexity of Asia's international order to a two player game between the United States and China," the report said. "In reality the Indo-Pacific ecosystem is created and sustained by a much wider array of actors."